Starbucks Operator In Malaysia Hit Hard By Anti-Israel Boycotts, Reports Significant Loss

Author: Nabaparna Bhattacharya | August 28, 2024 12:06pm

Malaysia’s Berjaya Food Bhd., which operates Starbucks Corporation (NASDAQ:SBUX) in the country, swung to a net loss of 38.2 million ringgit for the three months ended June, compared with a profit of 17.28 million ringgit a year ago.

Berjaya Food said in a filing that the key factors that affect the performance of the Group’s businesses include mainly the festive seasons, tourism, eating out culture, raw material costs, staff costs, and consumer perception.

The company reported revenue of 130.57 million ringgit and a pre-tax loss of 42.69 million ringgit for the quarter ended June. This contrasts with the previous year’s corresponding quarter, which saw revenue of 271.75 million ringgit and a pre-tax profit of 29.04 million ringgit.

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“The significantly lower revenue and pre-tax loss incurred in the current quarter under review were mainly due to the current sentiment in relation to the conflict in the Middle East,” the company said.

The U.S.-based fast food brands have landed in hot water in Asia, the Middle East, and some parts of Europe amid boycott issues due to their connections to Israel, reported Bloomberg.

For example, McDonald’s faced boycotts after social media photos and videos depicted its stores in Israel providing meals to soldiers following the October 7 attack, Bloomberg added.

Price Action: SBUX shares are trading lower by 2.88% to $95.76 at last check Wednesday.

Photo by Manu Padilla on Shutterstock

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